Question

Which of the following debit and credit rules is​ correct? A. Decreases in assets and liabilities are credited. B. Increases in liabilities and​ stockholders' equity are credited. C. Increases in liabilities and​ stockholders' equity are debited. D. Increases in assets and liabilities are debited.

Answer 1

Answer:

B. Increases in liabilities and​ stockholders' equity are credited.

Explanation:

As Liabilities and Stockholder's equity have credit balance, so a credit entry will increase their value and debit entry will decrease its balance. On the other hand assets accounts have debit balance, a credit entry will decrease its balance and debit entry will increase it. So the correct option is B. Increases in liabilities and​ stockholders' equity are credited.